CES 2014 Highlights: M2M, Connected Homes and Cars, Sponsored Data

Will AT&T's Sponsored Data Pass FCC Muster?

At this year’s International Consumer Electronics Show (CES) held in Las Vegas, we got a chance to see the miles (literally miles) of displays and demonstrations that featured curved TV sets, Ultra HD, “wearables,” smart appliances, and home security / automation systems.  But among the things that we found especially noteworthy were the evolution of the connected homes and cars, machine to machine (M2M) communications, and an announcement from AT&T unveiling “Sponsored Data.”

We think that the network of devices that “talk” with other devices and with people will have a profound effect on people that includes but reaches beyond communications and collaboration.  For example, medical devices that connect to a home automation system, doctors, and medical support systems can help us improve quality of life for an aging population.  Home security systems can warn us about traffic or weather hazards in our local neighborhoods. 

The connected car becomes a mobile hot spot complete with mobile apps with capabilities that range from diagnosing a problem with the car or closing the garage door and locking the doors when we leave home.  GPS systems have been optional in cars for over decade, but we can also talk to our automobiles to find the nearest restaurant or place a phone call. “There’s an app for that” is beginning to apply to our cars as much as to our smart phones.     

The third CES highlight for us was an announcement by ATT that allows eligible 4G customers to enjoy mobile content and apps over AT&T’s wireless network without impacting their monthly wireless data plan. The plan is similar to toll-free phone numbers or free shipping for internet commerce. With the Sponsored Data service, data charges resulting from eligible uses will be billed directly to the sponsoring company. Sponsored Data will be delivered at the same speed and performance as any non-Sponsored Data content.

We see a range of opportunities for this service – including the ability to hasten the adoption of mobile video conference, also allowing businesses with ‘Bring Your Own Device’ policies to pay for the data employees use for specific business-related apps and services. Other business to consumer services such as health care tutorials or mobile shopping may also be beneficiaries. 

Not unexpectedly, the FCC will take a close look at the AT&T plan to assure that it conforms to net neutrality regulation.  Also at CES, the FCC Chairman commented specifically on the AT&T plan, saying “It may well be that the kind of offering AT&T has announced enables increased competition and increased efficiency—both things that benefit consumers. It is not the sort of thing that should be prohibited out of hand. But, again, history instructs us that not all new proposals have been benign. There has to be some ability on the part of government to oversee, to assess, and, if warranted, to intervene.” 

He added, “I am not advocating intervention unless there is an unmistakable warrant for it. I am not interested in protecting competitors from competition, nor am I interested in presiding over a festival of rent seeking. But I am committed to maintaining our networks as conduits for commerce large and small.” 

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